Speech by Mark Boleat, Chairman, City of London Policy and Resources Committee, on EU Referendum at Court of Common Council

Checked Against Delivery

On 23 June the British electorate will go to the polls on an issue of fundamental importance to the future of the country in general and the City of London in particular, that is whether Britain should remain a member of the European Union or leave the Union.

At its meeting on 25 February, the Policy and Resources Committee had a lengthy and well-informed discussion on whether the Corporation should have a corporate view on British membership of the European Union and, if so, what that view should be. The Court paper contains all the information that the Committee had before it, although members also brought with them their own views, and were influenced by a thoughtful and civilized debate.

The Committee decided by a large majority, 18 votes to six, that the Corporation should have a corporate view, and by a larger majority, 17 votes to three, that that view should be:

“Taking into account the views of City stakeholders and businesses, the City of London Corporation supports the united Kingdom remaining a member of the European Union.”

I would first like to address an issue on which there has been some misunderstanding and indeed misinformation.

Some members are concerned that we might be spending money on campaigning for Britain to remain in the European Union and I can understand from reading the papers again how that view could be reached. Also members will have received a letter stating –

“It (the Corporation) also proposes to spend, in a time of austerity, very substantial sums of money on a position which is undoubtedly unrepresentative of the views of many of its electors, corporate and residential, whilst denying them other services for lack of funds.”

Let me reassure members on this.

The Committee did not consider whether, let alone decide, to spend any money on campaigning, nor is it going to do so in the future, nor is it going to contribute funds to any of the campaign groups. However, such is the wording of the legislation, or rather the Electoral Commission’s interpretation of it, that we find may that events such as last night’s Trade and Industry dinner or the Bankers Dinner or a dinner at which the Mayor of London is speaking are deemed to be expenditure on “campaigning”.

Nor is there any intention to depart from our traditional role of providing a forum for debate and giving all sides of the argument the opportunity to put their views. Indeed, only yesterday Zac Goldsmith, the Conservative candidate for Mayor, did that to a group of City practitioners at a breakfast meeting, and Business Secretary Sajid Javid and CBI president Paul Dreschler did that in the evening at the Trade and Industry dinner – the views expressed at the two events were very different. We have already hosted one big debate for Remain and Leave campaign groups and are keen to do more. If we do agree to commit money this will go through the approvals process in the usual way and it will be for events at which both sides of the argument will be put. And of course individual members will be free to express their personal views on the issue and to actively support one of the campaign groups.

But none of this precludes the City having a corporate view – as it has on other controversial issues. I was asked last night by a member what would be the practical effect of passing the resolution. It would simply be to indicate the City’s corporate view, nothing more. But that is important. We are a political body, elected members charged with taking decisions. But we are not party political, and this is not a party political issue. Wherever possible we support the Government of the day, and on this issue we would be supporting the Government in a view that is shared by the Labour, Liberal Democrat and Scottish National parties.

The evidence in front of the Policy Committee was that our stakeholders expect us to have a view and that that strong view is that Britain should remain a member of the European Union.

Members of the Committee were influenced by the views of “the City”, here meaning the widely defined UK financial services industry. Not one financial trade association has expressed the view that Britain would be better off leaving the EU – the views varying from neutrality to support for remaining. The representatives of major City institutions such as Lloyds of London, the London Stock Exchange, Aviva, Goldman Sachs, HSBC, Barclays, Prudential, RSA, Standard Life and Santander have given the views of their institution, not their personal views, that Britain should remain a member. The Lloyds Market is surely one of the great institutions of the City. The Chairman of Lloyds has written to the Lloyds market in the following terms: “The Council of Lloyds and the Franchise Board have carefully considered the question of EU membership in the context of the interests of the Lloyds market. We have unanimously concluded that the best outcome is for the UK to remain a member of the EU.” He pointed to the passporting trading rights with 27 member states of the EU and the benefits from the trade agreements that the EU has with many other countries. He concluded: “membership of the EU will be a crucial element in London being able to retain and reinforce its pre-eminent status as the global hub for insurance and re-insurance.” Surely we would want to support Lloyds in that.

Let me also look at the position of major City institution, JP Morgan. It again illustrates the importance of being in the single market. The key point here, and one that is often not well understood, is that understandably within the European Union a financial institution that is authorised and regulated in one country can operate throughout the whole of the European union without the need to set up separately authorised and regulated, and therefore staffed, businesses in other countries. J P Morgan has 20,000 staff in the European Union, 19,000 of these are in the United Kingdom, the majority in London, but substantial numbers in Bournemouth and Glasgow. To quote the Chief Executive, Jamie Dimon, “if we can’t passport out of the UK, we would have to set up different operations in Europe.” Some might say this is not a problem. And for JP Morgan it is something that would be done albeit at some cost. But what would be lost in London is the jobs, not just among bankers but also support staff not only within the company but also in suppliers large and small.

And lest anyone think that we take account only of big companies the views of our rapidly growing tech industry are interesting. In a poll of 98 fintech start-up business published yesterday, by Innovate Finance, the representative body for the fintech industry, supported by the City Corporation, 81% voted to remain in the EU, a very similar result to the survey conducted by Tech London Advocates last year.

The City Corporation is very much more than a local authority; it provides valuable services to the City and the country and it is an established and recognised voice for the financial services industry. The views of our stakeholders are certainly not unanimous, but by a significant majority they favour the UK remaining a member of the EU. And they expect us to stand up for them, to represent their position as we have done on many other controversial issues – Heathrow Airport and immigration to name just two - and the Policy Committee asks the Court to support that view.